The violence in Sri Lanka was close to a bloody conclusion last night as the country's armed forces sought to destroy the last pocket of Tamil Tiger fighters in defiance of international pleas for a halt to the fighting and accusations from the UN that they had triggered a bloodbath.

While leaders of the Liberation Tigers of Tamil Eelam were reported to be preparing to kill themselves rather than be captured, explosions reverberated around the tiny coastal strip where as many as 80,000 civilians remained trapped alongside the cornered rebels.

Humanitarian aid workers were in despair as sporadic reports filtered out of thousands of civilians killed inside the "no fire zone", the government-designated haven where non-combatants were supposed to be able to escape the fighting.

"It is hard to think of a worse place on earth to be right now than on that stretch of beach," said James Elder, the Unicef spokesman in Sri Lanka, as he struggled to contain his emotions.

The final assault went ahead in spite of a warning from British Prime Minister Gordon Brown to Sri Lanka that "there will be consequences for its actions". Downing Street said Brown had made several phone calls during the day to Sri Lankan president Mahinda Rajapaksa, urging him to bring the violence to an end. His pleas were ignored.

The Sri Lankan military said the Tigers, which have used the trapped civilians as human shields in an attempt to keep the army at bay, were detonating their ammunition dumps.

There were no reliable figures available for civilian casualties, but with tens of thousands of people crammed into an area of less than one square mile, humanitarian agencies feared the worst.

The military said last night that 10,000 civilians had breached the Tigers' inner cordon and were being shepherded to safety under fire from the rebels. Elder said those who remained were at the mercy of "indiscriminate firing" from all sides. "It is a bloodbath. It is a catastrophic situation," he said. "We are seeing a complete disregard for civilian life. Everyone's worst-case scenario is coming to pass."

About 20,000 people are believed to have escaped from the no-fire zone between Thursday and yesterday afternoon, but Elder said many of those who had managed to get out were in a terrible condition. "When you look at the state of the first people to leave three weeks ago, there were malnourished children and women, and people with gunshot wounds and shrapnel injuries, and these people now have been there for another three weeks with next to nothing to eat in terrible conditions. It is going to be a nightmare," he said.

Gordon Weiss, the UN spokesman, said reliable reports from inside the war zone had dried up after the "courageous" doctors who had been working out of the last makeshift hospital at Mullaivaikal East primary school were forced to abandon the building in the face of heavy fighting on Friday. "We are most concerned about the fate of the 30,000 to 80,000 people who are left inside the combat zone," he said. "This is precisely the situation we feared all along - that they would be left inside at the penultimate moments of the battle."

Despite the mounting death toll, neither side in the conflict showed any willingness to lay down arms to allow the trapped civilians to escape. The Tigers said in a statement that they were "extremely mindful of the civilian hardships" and were "prepared to take all necessary measures that would immediately stop the current carnage". They said that "an onslaught by the government will only result in thousands more dying and will not pave a way for a dignified and respectful outcome".

The Sri Lankan military said it would press on with what it described as a humanitarian operation. Brigadier Udaya Nanayakkara, the military spokesman, said: "Operations are continuing to rescue the civilians still being held hostage by the terrorists."

Yesterday the Sri Lankan army completed a pincer movement to surround the Tigers, seizing control of the coastline and cutting off the rebel group's escape route to the sea. The whereabouts of the group's leader, Velupillai Prabhakaran, and other senior commanders are unknown.

The UN secretary general, Ban Ki-moon, has sent his chief of staff, Vijay Nambiar, to Sri Lanka for a second time to try to bring the conflict to a peaceful conclusion. Nambiar was due to arrive last night for meetings with government officials. The government has brushed off calls from foreign diplomats for a humanitarian truce, saying this would only give the rebels time to regroup.

Attempts by the International Committee of the Red Cross to evacuate thousands of wounded civilians failed last week. The organisation said the scale of the fighting made it impossible to get casualties out.